Friday, May 6, 2011

STATUTE OF LIMITATIONS ON DEBTS

STATUTE OF LIMITATIONS ON DEBTS
There’s no doubt about it: You are responsible for the money you owe. If you fall behind in paying your creditors - or should you dispute the legitimacy of a debt - a collector may contact you.  “Time-barred” debts are debts so old they are beyond the point at which a creditor or debt collector may sue you to collect. State law varies as to when a creditor or collector may no longer sue to collect: generally in most states, the statute of limitations on debts is between 3 and 10 years; in some states, the period is longer. Check with your State Attorney General’s Office at www.naag.org, to determine when a debt is considered time-barred in your state.
Federal law imposes limitations on how debt collectors can collect debts, including time-barred debts. Under the Fair Debt Collection Practices Act (FDCPA), a “debt collector” generally is any person or organization that regularly collects debts owed to others. The definition includes lawyers who collect debts for others on a regular basis, but it does not include creditors collecting their own debts.

COLLECTING TIME-BARRED DEBTS

Please be aware that even though a debt collector can attempt to collect on a time barred debt does not mean that you legally have to pay. Let me repeat:  Please be aware that even though a debt collector can attempt to collect on a time barred debt does not mean that you legally have to pay.   If they have gone beyond the time limitations, they can ATTEMPT to collect, but you do not have to pay.  And, they cannot legally collect on this debt.  The critical part is when the clock starts ticking.
Most courts which have addressed the issue have ruled that the FDCPA doesn't prohibit debt collectors from attempting to collect time-barred debts, as long as they just don't sue or threaten to sue you for the debt. If a collector sues you to collect a time-barred debt, you can have the suit dismissed by letting the judge know the debt is, indeed, time-barred.
Whether a time-barred debt - or any debt for that matter - can appear on your credit report depends on how long your debt has been delinquent: debts that have been delinquent greater than seven years cannot show up on your credit report, with certain exceptions.
CONTACT WITH COLLECTORS
Can a debt collector continue to contact you about a time-barred debt you don’t think you owe? Based on the law, should you send the debt collector a letter stating that you do not owe some, or all, of the money within 30 days after you receive written notice of a debt, the collector must stop trying to collect until you’ve been given written verification of the debt, like a copy of the bill for the amount you supposedly owe. The collector can renew collection activities once you’ve received proof of the debt. You are able to stop debt collectors from contacting you about any debt, whether or not you owe it, by writing correspondence telling them to stop contacting you. Master Credit Solutions has a copy of a letter we use. If you would like a copy, let us know and we will forward that on to you. For this letter, please contact us at info@mastercreditsolutions.com.  Once the collector gets your letter, it may not contact you again - except to say there will be no further contact or to let you know that the collector or creditor intends to take some specific action. Sending a letter doesn’t absolve you of the debt if you actually owe it; the debt collector or creditor still could sue you for the debt.


FUTURE COLLECTION EFFORTS
The best way to protect yourself from future collection on any disputed or partially settled debt is to get a form or letter from the creditor or collector that releases you from further obligation. To ensure the release is valid, you may want to consult an attorney. If you believe that a debt collector violated the law, you have the right to sue in a state or federal court within a year from the date the law was violated. If you win, you may recover money for the damages you suffered, plus an additional amount up to $1,000. You also may recover court costs and attorney’s fees. Additionally you may choose to report any problems you have with a collector to your State Attorney General and to the Federal Trade Commission.
Please remember that not all debt has a statute of limitations. There is no statute of limitations on:
Federal Student loans
Most fines
Some tax bills
All child support obligations

WHEN DOES THE TIME START TICKING
The clock starts once you violate the loan agreement, usually the first time you miss a payment deadline. If you make any kind of payment later on or charge something on the account or do anything whatsoever that shows you know that is your debt, the time will stop and reset to zero.

STATUTE OF LIMITATIONS – IN YEARS
According to the States Attorney’ Generals Office, here is the Statute of Limitations – State by State. This is up to date, as of the date of this writing.  You should contact your specific office.




STATE OF LIMITATIONS - IN YEARS
STATE
ORAL CONTRACTS
WRITTEN CONTRACTS
PROMISSORY NOTES
OPEN-ENDED ACCOUNTS
AL
6
6
6
3
AR
5
5
5
3
AK
6
6
3
3
AZ
3
6
6
3
CA
2
4
4
4
CO
6
6
6
3
CT
3
6
6
6
DE
3
3
3
4
DC
3
3
3
3
FL
4
5
5
4





GA
4
6
6
4
HI
6
6
6
6
IA
5
10
5
5
IL
4
5
5
4
ID
5
10
10
5
IN
6
10
10
6





KS
3
5
5
3
KY
5
15
15
5
LA
10
10
10
3
ME
6
6
6
6
MD
3
3
6
3
MA
6
6
6
6
MI
6
6
6
6
MN
6
6
6
6
MS
3
3
3
3
MO
5
10
10
5
MT
3
8
8
5
NC
3
3
5
4
ND
6
6
6
6





NE
4
5
5
4
NH
3
3
6
3
NJ
6
6
6
6
NM
4
6
6
4
NV
4
6
3
4
NY
6
6
6
6
OH
6
15
15
6
OK
3
5
5
3
OR
6
6
6
6
PA
4
6
4
6
RI
10
10
6
4





SC
3
3
3
3
SD
6
6
6
6
TN
6
4
6
6
TX
4
4
4
4
UT
4
6
6
4
VA
3
6
6
3
VT
6
6
5
4
WA
3
6
6
3
WI
6
6
10
6
WV
5
15
6
4
WY
8
10
10
8




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